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May 22, 2024

Renters’ Paradise: Exploring the Rise of Build-to-Rent Living

The Build to Rent (BTR) market has experienced a remarkable surge in interest from investors, developers, and various institutions in recent years. What has spurred this dramatic uptick in BTR interest? Sources like NARS, CRE Daily, and countless other news outlets have identified numerous factors. However, certain vital fundamentals consistently emerge as the focal point for BTR interest. These include a systematic lack of affordable housing, escalating home prices and interest rates, attractive amenities, reasonable rental price points, and the desire for single-family living.

Freddie Mac estimates the country’s housing shortage to be approximately 3.8 million homes. One strategy many developers are employing to address this shortage is through BTR initiatives. Although BTR gained traction before the pandemic, the global crisis only intensified its momentum. With many development and investment firms already engaged in master-planned communities and constructing single-family homes for sale, BTR emerged as an appealing diversification opportunity for their portfolios.

RREAF Holdings Development: Capstone Court BTR Residential Community 
RREAF Holdings Development: Capstone Court BTR Residential Community

BTR is not just a solution for the housing crisis, but also a beacon of hope for millennials and Gen Z, who often find homeownership out of reach. The soaring home prices and high interest rates have made the traditional American Dream increasingly elusive for these new-age homebuyers. As a result, they are turning to BTR options, which offer the benefits of homeownership without the hefty costs. Additionally, the baby boomer generation has also expressed significant interest in BTR, enticed by the idea of living in a secure, newly built home with reduced maintenance requirements during retirement.

The appeal of BTR communities extends beyond the housing itself. These communities are a haven of upscale amenities, offering residents a lifestyle of comfort and convenience. From pickleball courts and pools for fitness enthusiasts to community centers and multipurpose rooms for social gatherings, business centers for professionals, walking trails and dog washes for pet lovers, car washes, and even community gardens for those with a green thumb, BTR communities have it all.

 

 

Sources:
Ballinger, Barbara. “Build-to-Rent Is Transforming the Landscape.” Www.Nar.Realtor, 4 Apr. 2023, www.nar.realtor/magazine/real-estate-news/commercial/build-to-rent-is-transforming-the-landscape.
Khater, Sam, et al. “Housing Supply: A Growing Deficit.” Freddie Mac, www.freddiemac.com/research/insight/20210507-housing-supply. Accessed 16 May 2024.

Disclaimer:
The contents of this article are not investment advice and should not be construed as such. Statements herein do not specifically describe any RREAF investment deal in particular. Information about specific RREAF investment opportunities are only contained in the applicable published “Private Placement Memorandum” issuing a given opportunity. Statements on performance may be qualified. Past performance does not predict future success.